Shares of drugmaker Cadila Healthcare Ltd plunged as much as 15 per cent in intra-day trade on Thursday after the US Food and Drug Administration sent a warning letter about its Moraiya formulation facility and Ahmedabad bulk drugs facility.
The company’s shares were trading at Rs 328.35 each, down 14.75 per cent in a flat Mumbai market at 12:40 PM on Thursday.
Cadila said in a stock exchange filing it will continue to take all necessary steps to ensure the FDA is fully satisfied with its remediation efforts.
The company clarified that no products in the US market use bulk drugs made at the facility that is under scrutiny.
The warning letter to Cadila came just days after India’s top drugmaker Sun Pharmaceutical said it got a similar letter about its Halol facility in Gujarat . A warning letter increases the risk of the US drug regulator imposing a ban on imports from the factory.
In 2014 as well, the US FDA had issued a warning letter to Cadila for violating current good manufacturing practice norms at its Ankleshwar plant in Gujarat.
Indian pharmaceutical companies, which supply about 40 per cent of the generic drugs sold in the US, have come under greater scrutiny from the FDA over quality issues for the past couple of years.
Early in November, India’s second-largest drugmaker Dr Reddy’s Laboratories Ltd received an FDA warning letter citing quality control issues.
In May 2013, Ranbaxy Laboratories Ltd agreed to pay $500 million in fines to settle charges of falsifying data and lying to US regulators. Sun Pharmaceutical acquired Ranbaxy last year.
Cadila counts Norwegian sovereign fund Government Pension Fund Global as a shareholder.